Old Dominion, Hanjin offer joint LCL service
Old Dominion Freight Line is the latest domestic motor carrier to partner with an ocean carrier to provide an expedited less-than-container for U.S. shippers.
The guaranteed service, called 'Pacific Promise,' is scheduled to begin April 1 from the Chinese ports of Shanghai, Shenzhen and Hong Kong, and is expected to shave 10 days off the normal transit time for consolidated shipments, Old Dominion said.
The company said Hanjin Logistics will consolidate shipments at container freight stations in China and arrange transport on vessels operated by parent company Hanjin Shipping, while the OD Global division will arrange inland transport from the ports of Los Angeles and Long Beach through Old Dominion's less-than-truckload network.
Transit times will vary depending on the origin port and destination city, but are expected to be about 17 to 19 days to the Midwest and 19 to 20 days to the East Coast, according to Greg Plemmons, vice president of OD Global.
LCL shipments can face delays on both sides of the ocean journey because freight intermediaries often have to wait until they have enough shipments from multiple customers to fill a container and then deconsolidate at the first U.S. port of entry for onward distribution.
By using a dedicated trucking company ocean carriers are trying to streamline the delivery process to increase speed, predictability and shipment status information.
Pacific Promise will also offer a simplified rate structure. Rates are expressed as a simple single rate per cubic meter that will be slightly more than standard LCL rates, but up to 75 percent cheaper than air freight, Thomasville, N.C.-based Old Dominion said. Its target customer base includes shippers of high-value, time-sensitive, seasonal, and promotional cargo, as well as those shipping to multiple destinations from a single origin.
The Old Dominion-Hanjin product takes its cue from OceanGuaranteed, an express LCL service launched almost three years ago by APL Logistics and Con-way Freight.
Averitt Express, another LTL carrier, last year started an express LCL service that differs from OceanGuaranteed and Pacific Promise in several ways. The Averitt product does not use an exclusive ocean carrier and relies on a Chinese consolidator to book through transport to Memphis, Tenn. Rather than go directly into the Averitt network the load is placed on a BNSF train and is deconsolidated at Averitt's main terminal for immediate delivery to local terminals.
While OceanGuaranteed and Pacific Promise target deferred air freight customers seeking less expensive reliable transport, Averitt seeks to attract existing ocean customers.
Matson and trucking company J.B. Hunt offer a guaranteed, expedited service for full containerloads.
Con-way also has a partnership with Tropical Shipping to deliver LCL exports to Florida ports for transport to the Bahamas and the Caribbean.
Old Dominion said it planned to expand its new LCL service to more origin locations. ' Eric Kulisch